UK court orders asset freeze of NMC founder BR Shetty, other company executives

A court in London has ordered a worldwide freezing order on the assets of BR Shetty, founder of UAE-based NMC Health, as well as other senior former executives of the company.

The order was secured by NMC’s biggest creditor, Abu Dhabi Commercial Bank (ADCB), which has exposure of more than $1bn to the group, Financial Times reported.

The order has been issued against six defendants including BR Shetty, NMC’s former CEO Prasanth Manghat, two senior financial officers as well as Emirati investors Khalifa al-Muhairi and Saeed al-Qebaisi.

London-listed NMC Health, which had a market value of $10bn at its peak, faced allegations of fraud after investigators discovered $4bn worth of undisclosed debt, bringing its total debt to over $6.6bn. The incident pushed NMC and its sister company Finablr into administration last year. Shetty has denied wrongdoing and claimed that he is a victim of fraud.

In a witness statement presented at the London court by current NMC CEO Michael Davis, he alleged that evidence uncovered by a forensic team shows that fraud was carried out by former executives in the company “from at least 2012 to February 2020”.

NMC is currently undertaking a complete restructuring of its balance sheet and last week reported that revenues for the group dropped 6 per cent in 2020 to $1.53bn, down from $1.63bn in 2019.

On December 21, NMC announced that it had agreed to sell its subsidiary Eugin (Luarmia and Boston IVF) to Fresenius Helios for an enterprise value of EUR430m (approximately $525m). The deal is expected to close during the first half of 2021 following completion of necessary competition filings.

Meanwhile NMC’s financial advisers, Perella Weinberg Partners and Resonance Capital also recently launched a sale process to explore potential interest in its core business in the UAE and Oman.

The sale process will be run in parallel with the ongoing restructuring discussions with NMC’s lenders.

Read: NMC Health expects UAE, Oman operations to continue in 2021, after sale of non-core assets